Recent report from the Financial Conduct Authority - summary below:
To understand more about the experiences of consumers most at risk of unmanageable debt, we have conducted primary research looking at the attitudes towards, and use of, credit for people on the lowest incomes.
What did we look at?
Our research identifies three distinct borrower groups – survival borrowers, lifestyle borrowers, and reluctant borrowers – and explores how these groups use credit and the reasons for doing so. Our research also shows how debts can become unmanageable, and the strategies people use to cope with spiralling debts, showing how unmanageable debt triggers both financial detriment and affects health and wellbeing.
While many of the people we interviewed had low awareness of the help and support available to them, debt advice is effective in helping people get out of unmanageable debt. So helping people get the right advice and solution they need, before debt gets out of control, is vital. As we take over the regulation of this sector, we welcome a broader debate with stakeholders to encourage more people to get access to good quality advice earlier, before they reach crisis point.